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Supreme Court denies rehearing of annexation case

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By Stephen Lega

The Kentucky Supreme Court has upheld the City of Lebanon’s annexation of 415 acres of property for a second time.
On March 20, the Supreme Court issued a 6-1 decision upholding the city’s annexation. The 2006 annexation included residential properties and multiple businesses, including Wal-mart, along Campbellsville Highway into the city limits.
On Thursday, Aug. 21, the Supreme Court unanimously denied a petition for rehearing filed on behalf of property owners who opposed the annexation.
Many of those property owners own businesses in the annexed area, and they had filed a petition opposing the city’s actions in February of 2006. The city deemed that petition insufficient because it did not include 50 percent of the resident voters in the annexed area.
In response, a lawsuit was filed in Marion Circuit Court. Marion Circuit Judge Allan Bertram initially upheld the annexation in 2010, but attorneys for the property owners requested that Bertram reconsider his decision. On April 22, 2010, Bertram changed his initial order and ruled that the annexation was invalid.
The Court of Appeals agreed that the annexation was invalid, but that decision was overturned by the Supreme Court decision.
Chief Justice John D. Minton wrote the majority opinion in favor of the city.
“The City wholly adhered to the statute in annexing a territory that was "adjacent or contiguous" and suitable for urban development. Annexation boundaries are not required by Kentucky law to be ‘natural or regular.’ And the City did not violate the Kentucky Constitution,” Minton wrote.
Deputy Chief Justice Mary C. Noble and Justices Lisabeth Hughes Abramson, Bill Cunningham, Michelle M. Keller and Daniel J. Venters concurred with Minton’s opinion.
Justice Will T. Scott wrote in a dissenting opinion that he agreed with the Court of Appeals original ruling that the annexation was invalid.
“[The] City's blatantly unnatural manipulation of the annexed property's boundaries — omitting dissenting property owners so as to ensure the success of the annexation — should render this annexation void,” Scott wrote.

‘Big relief’ for city
The City of Lebanon has been collecting property, occupational and tourism taxes in the annexed area since February of 2006, but those funds have been held in an escrow account pending resolution of the court case.
City Administrator John O. Thomas said the city anticipates it will have around $745,000 in that account at the end of August. That includes $65,350.20 for the Lebanon Tourist and Convention Commission, he said.
“It’s a big relief not having to worry about it anymore,” Thomas said.
City Attorney Kandice Engle-Gray agreed.
“We’re happy to have it ended and to be able to move on,” she said.
Thomas said that the city felt confident about its case, but it did not know what would happen until the Supreme Court issued its decision in March.
“It will benefit not only Lebanon but cities across the Commonwealth,” Thomas said.
Jim Avritt Sr. argued the case before the Supreme Court on behalf of the property owners who opposed the annexation.
Avritt noted that the Marion Circuit Court and the Court of Appeals deemed the annexation invalid, but the Supreme Court overruled those decisions. While he wasn’t surprised that the Supreme Court denied the petition for a rehearing, Avritt said it was still disappointing.
He added that the city admitted that it allowed 18 property owners to decide whether or not they wanted to be annexed, but denied that option to five other property owners included in the annexed area.
“To me, that’s unfair. That’s unequal,” Avritt said.
As a result, the city now has “islands” of property that are surrounded by the city limits but are not part of the city officially. Because of the Supreme Court’s ruling, he said cities can do whatever they want to make annexations happen. He continued to say it was ridiculous, but it’s the law now.
“It’s the worst decision I have seen from a legal standpoint in 40-some years of practicing law,” Avritt said.